Dick's Sporting Goods takes on major risk with $2.4 billion bet on Foot Locker

yahoo Finance

Dick’s Sporting Goods’ (DKS) big bet for Foot Locker (FL) may have plenty of pitfalls.

“The proposed transaction would mean acquiring a structurally challenged, mall-based retailer with 2,410 small-format stores worldwide … a heavy dependence on one brand [Nike] … and a weak operating margin of 2.5% in 2024 that would be dilutive to Dick’s 11.0% in 2024,” Telsey Advisory Group’s Joe Feldman wrote in a note clients.

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